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The U.S. Supreme Court is heading into the final stretch of the term, and the justices issued a raft of new and consequential decisions today on everything from opioids to ozone pollution. NPR legal affairs correspondent Nina Totenberg reports.
NINA TOTENBERG, BYLINE: In the space of less than a half-hour this morning, the high court invalidated a multi-billion-dollar opioid settlement. It put on hold an important EPA rule aimed at reducing ozone pollution. It temporarily allowed emergency abortions in Idaho in cases where the woman's health but not her life is in grave jeopardy. And finally, the conservative supermajority continued its march to curtail agency power, ruling that Congress exceeded its power when it authorized the Securities and Exchange Commission to impose fines on financial wrongdoers.
The SEC decision ruled unconstitutional one of the major ways that the agency penalizes those found to have committed fraud in the securities industry. Congress specifically strengthened the law in 2010 by authorizing the SEC to use independent administrative law judges to conduct hearings, make factual findings and to impose fines on those accused of securities fraud.
But today, writing for the court's conservative supermajority, Chief Justice John Roberts said that system violates the Seventh Amendment right to a jury trial. Although he acknowledged that under the current system, the accused do have the right to appeal in federal court, Roberts said that's not the same thing as having the right to be tried by a jury of one's peers in a courtroom supervised by a federal judge.
In a rare oral dissent from the bench, Justice Sonia Sotomayor accused the majority of, quote, "judicial aggrandizement and blowing up the so-called public rights doctrine." Under that doctrine, she observed, the court has, for more than a century, permitted agencies, when authorized by Congress, to penalize with monetary penalties those who have defrauded the government.
Make no mistake, she said. Today's decision is a power grab. Once again, the majority arrogates Congress' policy-making role to itself. And in so doing, she said, the court has cast a cloud of doubt over the way dozens of agencies carry out their congressional mandates. Congress, she said, had no reason to anticipate the chaos today's majority would unleash after all these years.
Indeed, the court's decision could have huge ripple effects for agencies that use a process like the SEC's to enforce laws on everything from labor rights to mine safety and energy regulation. But as Case Western University professor Jonathan Adler observes, the court's majority did carve out an exception for agencies that deal with federal benefits.
JONATHAN ADLER: The court doesn't touch Congress' ability to allow agency adjudication for public benefits and pensions and patents and things like that.
TOTENBERG: Indeed, the court's decision leaves intact the Social Security Administration's cadre of 1,500 administrative law judges who make decisions in a half-million cases every year.
The SEC case was brought by George Jarkesy, a former conservative radio talk show host and hedge fund manager who was supported by a who's who of conservative and business groups, plus some individuals like Elon Musk, who's repeatedly resisted the SEC's attempts to probe whether he illegally manipulated his company's stock. Jarkesy was investigated for fraud, and after a hearing before an administrative law judge, he was fined $300,000 and ordered to pay back $700,000 in ill-gotten gains. In addition, the agency barred him from various activities in the securities industry.
Today's Supreme Court decision did not touch that $700,000 in restitution, just the fine. George Washington University law professor Alan Morrison says the court seems to be drawing a line between a fine, a penalty that is not permissible and restitution, which is. That, he notes, may be a saving grace for the agency.
ALAN MORRISON: So an agency like the SEC may say, look. Disgorgement is a lot of money, and we'll be happy to get disgorgement and stay at the administrative level.
TOTENBERG: Ironically, after today's ruling, the SEC is likely to suffer fewer consequences than other agencies, largely because the Supreme Court, beginning in 2018, began eating away at the agency's power to use administrative law judges. And in response, the SEC decreased the number of ALJs at the agency from six to two, choosing instead to bring its cases mainly in federal court. Federal courts, however, do not have the power to bar convicted offenders from working in the securities industry.
Nina Totenberg, NPR News, Washington. Transcript provided by NPR, Copyright NPR.
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